Update on Pushpay (NZSX:PAY)

Update on Pushpay (NZSX:PAY)

“…I define Hyper-Growth as $1m to $10m ARR in five quarters or less…” Jason Lemkin, Managing Director, Storm Ventures and Advisor to SaaStr.
Pushpay are ~160 merchants, or ~one months’ growth away from doing it in less than four.

Target Price
Our 12 month target price remains unchanged at $4.92 per share, almost 25% above the current market price.

Key Points
Hyper-Growth – Pushpay are close to joining the club of SaaS companies that grew from $1m to $10m ACMR in less than five quarters.
Underpinning this ACMR growth was a significant uplift in ARPM for the quarter up from NZ$491 to NZ$534 (~9%). This was greater than expected and for a large part was influenced by the USD appreciation against the NZD.
Merchant numbers were up 42% for the quarter. This is slightly down on expectations included in our target price. The Company has provided guidance that the target remains for >2,000 merchants by the end of September 2015.
Liquidity in Pushpay’s shares remains relatively low.
Cash on-hand, the securing of a Callaghan R&D Project Grant and the Christopher & Banks standby facility provides the Company with sufficient funds to continue its aggressive growth strategy in the near term. We do however, expect the Company to require additional capital in the next 12-18 months and will possibly seek to source this earlier.
We have narrowed our valuation range for Pushpay, removing the slowest growth profile based on the company’s track record of growth.

For more details see full report: http://clarecapital.co.nz/pushpay-equity-research/

ENDS

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